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Proposed EPA Emissions Rules and How it Affects All of Us – Part 1

June 23, 2014 

I wrote a few weeks ago about the NAM Manufacturing Summit held in Washington, DC on June 10th and 11th this month.  Right before we visited Washington, the EPA issued proposed rules for existing power plants regarding emission reductions from these plants.

This is one of those topics we see in the headlines among hundreds of others that pass us by but we as an industry have a vested interest in this topic since we believe it will drive up the cost of electricity substantially for both industry in the US and residential electric users.

Here is a summary that was developed by the Franklin Group in Washington.  They respresent the North American Die Casting Association (NADCA) in Washington and assist in presenting the die cast industry’s concerns and voice to our elected officials.  I am providing a quick outline this week so you can get an overall picture of this issue.
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Who: U.S. Environmental Protection Agency (EPA)
What: Two Proposed EPA Rules Covering Emissions from New & Existing Power Plants
Why: U.S. Supreme Court Rules that Greenhouse Gas Emissions (GHG) are Air Pollutants
When: 1997: Petition filed during Clinton Administration

  • April 2, 2007: Supreme Court Ruling in Massachusetts v. EPA
  • March 27, 2012: EPA proposed New Source Performance Standard for new power plants
  • June 25, 2013: Presidential Executive Memorandum directs EPA to issue regulations
  • Sept. 20, 2013: EPA issues revised proposed rule covering new power plants
  • June 2, 2014: EPA issues 645-page proposed rule for existing power plants
  • Sept. 30, 2014: Public Comments due on proposed rule for existing plants
  • January 2015: EPA likely to issue final rule for new power plants
  • June 1, 2015: EPA likely to issue final rule for existing power plants
  • June 30, 2016: States must issue plans to implement the rules

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Background

April 2007 U.S. Supreme Court rulings set in motion a series of actions by the EPA to limit carbon emissions from vehicles, factories and power plants. Prior to that, a battle waged throughout the George W. Bush Administration era between environmental groups and industry, which ultimately resulted in the Supreme Court’s determination that EPA has the authority to issue regulations reducing emissions under the Clean Air Act.

In 2012, the Obama Administration issued a proposed standard for new power plants. After receiving over 2.5 million comments on the rule, the EPA temporarily withdrew the standards pending review of the comments. Subsequently, President Obama sent out an Executive Order in June 2013 directing

the EPA to issue proposed regulations covering new power plants by September 2013 and a proposed rule for existing power plants by June 2014, to take effect June 2015.

What NADCA is Doing

NADCA will file comments opposing the proposed regulations in addition to supporting efforts by coalition partners to educate members of Congress and the public on this important issue. The Association’s lobbying team, The Franklin Partnership, is meeting with officials in Washington and working with other manufacturing groups to press our priorities.NADCA points to government data showing that pollution levels are dropping using existing technologies.

New Power Plants Proposed Rule

The September 2013 proposed rule covers new power plants and generated the most controversy over a new process called Carbon, Capture, Sequester (CCS). This would require new coal and coke-fired plants to partially use CCS to capture and store emissions, while also directing new natural gas facilities to use the latest technologies. Critics of CCS say it is still an unproven and costly technology. EPA expects to finalize the rule for new power plants in January 2015.

Existing Power Plants Proposed Rule

The regulation of emissions from existing power plants is receiving the most attention. The proposed rule aims to reduce by 2030 nation-wide emissions by 30 percent from 2005 levels, with much of the reductions coming by 2020. In the U.S., there are 1,000 fossil fuel fired power plants with 3,000 units covered by this rule. Each state will have differing targets, which vary widely from the largest in Washington state at 72% reduction by 2030 to North Dakota’s goal of an 11% reduction.

To achieve this approach, EPA does not directly target the power generating facilities, but provides goals for states to achieve. Citing its authority under the Section 111(d) of the Clean Air Act, the EPA proposal seeks to use the “best system of emission reduction” that is available to limit pollution. By this, it intends to allow states to use a number of methods to achieve the goals. It permits states to take various approaches including improving energy efficiency through power plant operations and encouraging reliance on low-carbon energy and renewable sources. However, it also proposes a number of restrictions on production, including capacity controls and exploring ways to reduce energy demands.

By leaving much of the methods used to achieve the goals up to the states, the Administration sought to blunt itself from criticism that it is imposing new technologies on existing facilities – a main point of contention under the proposed rule for new power plants. The EPA will consider a number of different approaches when the governors submit their draft State Implementation Plans (SIPs) by June 2016.

However, unlike the proposal covering new facilities, the existing power plant regulation does not require the use of Carbon, Capture, Sequester (CCS) technologies, although it does encourage using the latest technologies.

What the Public Can Do

The public has until September 30, 2014 to comment on the proposed regulation of emissions from existing power plants. Meanwhile, the EPA will resume its listening sessions that the agency began in 2013, with several slated to take place around the country in late July. Per the President’s 2013 Executive Memorandum, the EPA is likely to issue a final regulation of existing plants by June 1, 2015. States will have until June 1, 2016 to demonstrate to the federal government how they will achieve the goals; they may also ask for a one year extension (multiple states creating a regional plan may have a two year extension).

The EPA will hold four additional hearings where the public may testify on emissions regulations:

  • July 29, 2014 Atlanta, Georgia 9:00 a.m. – 8:00 p.m. (EST)
  • July 29, 2014 Denver, Colorado 9:00 a.m. – 8:00 p.m. (MDT)
  • July 30, 2014 Washington, DC 9:00 a.m. – 8:00 p.m. (EST)
  • July 31, 2014 Pittsburgh, Pennsylvania 9:00 a.m. – 8:00 p.m. (EST)

This may be a great opportunity for those of you who are active in Washington activities to go and make your voice heard.

Premier Die Casting Company has been in business 69 years and has been active in NADCA and its Government Affairs Committee in Washington DC affairs for nearly 40 years now.

Please send your inquiries and project files to sales@diecasting.com By Leonard Cordaro, President of Premier Die Casting Company

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